The internalisation of the Group's management structure, further rental growth and reductions in the cost of finance will help maintain our strategy of paying a progressive dividend to our shareholders which is fully covered by earnings.

Business model   Investment case

Strategic objectives

The Group looks to selectively grow its property portfolio by funding and acquiring high quality developments, newly developed facilities and investing in already completed, let healthcare real estate.

Activity in 2022
  • Selectively acquired four standing assets in the year investing £52.9 million all within the UK
  • Portfolio stands at 513, including 20 in Ireland, following some strategic disposals during the year that generated profits of £2.9 million (13% above book cost)
  • Total property return in the year of 2.8%, with income growth remaining strong at 5.0% offset by unfavourable movements in valuation as a result of the increased uncertainty and higher interest environment faced
Looking forward
  • Sector fundamentals of long leases and government backed income continue to drive demand in sector
  • In the short term, we expect investment activity will continue to be muted and will only take place if accretive to earnings
  • The Group has two developments in legal due diligence, one in Ireland for £13.1 million and one in the UK for £3.5 million

Content sourced from 2022 Annual Report.

PHP manages its portfolio effectively and efficiently, managing the risks faced by its business in order to achieve its strategic objectives.

Activity in 2022
  • £3.3 million, or 2.4% additional income from rent reviews and asset management projects
  • Ten asset management projects completed in the year, with a further ten on-site, investing £17.3 million and generating £0.5 million of additional income. All asset management projects increased EPC rating to B or above
  • EPRA cost ratio of 9.9% continues to be the lowest in the sector
  • Twenty three lease regears completed in the year
Looking forward
  • Strong pipeline of over 22 advanced asset management projects being progressed
  • Continued discussions with occupiers to discuss requirements and identify new opportunities

Content sourced from 2022 Annual Report.

The Group funds its portfolio with a diversified mix of equity and debt on a secured and unsecured basis, in order to optimise risk-adjusted returns to shareholders.

Activity in 2022
  • Extended all debt that was due for expiry in 2023 and 2024
  • £350 million of revolving credit facilities renewed in the year, all for three-year terms, which included increasing the £50 million Lloyds facility to £100 million
  • €75 million private placement for twelve years at an all-in rate of 1.64% completed in February 2022
  • £100 million sustainability linked loan facility renewed with HSBC
  • Significant liquidity headroom with cash and collateralised undrawn loan facilities totalling £326 million (2020: £362 million) after capital commitments
Looking forward
  • All short-term refinancing risk faced by the Group in the next two years eliminated in the current volatile economic environment

Content sourced from 2022 Annual Report.

Positive yield gap between acquisition and funding remains for selective investments, despite the macroeconomic environment along with continued improvements in rental growth, delivering progressive shareholder returns.

Activity in 2022
  • Adjusted earnings per share 6.6 pence increased by 6.5% (2021: 6.2 pence)
  • Dividend per share increased by 4.8% to 6.5 pence
  • Total Adjusted NTA return of 2.1%
  • Strong organic rental growth from rent reviews and asset management projects together with interest cost savings from the various refinancings completed in 2021 and the first half of 2022, offset the selectively muted investment in the year
Looking forward
  • New loan facilities provide significant firepower to secure new investment opportunities
  • 94% of the Group’s net debt is fixed or hedged protecting underlying earnings from potential interest rate rises that may result from recent and future economic and potential change

Content sourced from 2022 Annual Report.